Judgment: 2006-05-15 · Court archive

Supreme Court upholds security for costs order in Donegal land dispute

The court dismissed the West Donegal Land League’s appeal but capped the security assessment at the anticipated costs of a hearing of up to four days.

Supreme Court ·

Who, what, where, when and why

Who
  • The West Donegal Land League Limited (Plaintiff)
What

The court dismissed the West Donegal Land League’s appeal but capped the security assessment at the anticipated costs of a hearing of up to four days.

Where

Places mentioned in the report

  • County Donegal
  • Donegal Airport
When

Judgment:

Why

Reasons reported in the judgment

The Supreme Court has dismissed an appeal by the West Donegal Land League Limited against an order requiring it to provide security for the second-named respondent’s costs in a land action. It affirmed the High Court order, directing that the security be assessed on the basis of a maximum four-day hearing, with the amount to be assessed by the High Court Master.

The Supreme Court has dismissed an appeal by the West Donegal Land League Limited against an order requiring it to provide security for the second-named respondent’s costs in a land action. It affirmed the High Court order, directing that the security be assessed on the basis of a maximum four-day hearing, with the amount to be assessed by the High Court Master.

The appeal concerned a preliminary costs motion, not the ownership dispute itself. The Supreme Court did not decide whether the League or the respondents have rights in the land. It said those issues remain for trial, and that either side could ultimately succeed.

The League claims to be successor to about 28 individuals with beneficial interests in 28 undivided thirtieth shares in two Folios covering more than 213 acres in County Donegal. The land is now associated in part with Donegal Airport. The statement of claim alleges that graziers and their successors continued to use the land and that registered owners held it on trust. Those claims have not been determined.

The second-named respondent denied the alleged ownership rights and trusteeship, and pleaded the Statute of Limitations. The judgment described these as stateable defences. It also noted uncertainty in the material before the court about who claimed rights and under what title, including that no alleged transfer of rights to the League had been exhibited in the affidavits.

The Supreme Court said the League, a company limited by guarantee, fell within section 390 of the Companies Act 1963. The evidence established that it would have little or no assets to meet a costs order if the defence succeeded. The burden therefore fell on the League to show special circumstances that might justify refusing security.

The court rejected procedural grounds for sending the motion back to the High Court, including complaints about the hearing and apparent bias. On the merits, it found no applicable special circumstance. The action was private litigation, there was no individual co-plaintiff, and the court did not consider an earlier alleged admission of trusteeship in a tax context sufficient to displace the second-named respondent’s entitlement to security.

In fixing the basis for the security, the court considered that a full costs order might not necessarily follow if the respondents succeeded, and that the land issues could potentially be tried in four days with case management. It left any future applications concerning the order to the High Court.

Read the original court judgment

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